John Ensign

Mr. ENSIGN

Mr. ENSIGN. If I may respond to the Senator from New Jersey, first of all, we have a difference of philosophy. The ranking member on the Budget Committee and I had this discussion last night. There is a difference in philosophy. This Senator believes in cutting tax rates, giving entrepreneurs more of their own money. For instance, when I was practicing as a veterinarian, I was a sole proprietor. If I wanted to expand my business, I looked at my costs, and I looked at rate of return. Part of that was taxes. Could I justify expanding my business. I looked at the cost of borrowing. I looked at the cost of taxes. I looked at all those variables. The higher you raise the cost of taxes, the less expansion of business you are going to get, the fewer jobs you are going to create. While we have to have tax rates that allow what we believe in to be funded, there is a balance there. I believe if we raise taxes, as you are suggesting, especially as fragile as this economy and this economic recovery is, it could send us back into a double-dip recession as we have seen this economy do historically several times. I think raising taxes would actually threaten the Social Security trust fund because, as the Senator from Oklahoma said, the only real security for the Social Security trust fund as it is set up today is a strong economy. We have the baby boomers who are retiring, this huge demographic shift. When Social Security was first set up, there were 39 workers for every one retiree. The retirement age was 65. The average age when people died was 63. That is why a pay-as-you-go system worked for all those years. We had plenty of workers to pay for the retirees. We are down to less than four workers for every one retiree today. We are going to two to one. In future years, if we continue with the birth rates and the increase in age that people live, we will be down to one to one. A pay-as-you-go system does not work in that regard. It is an important debate to have. I realize we are not going to solve this on the budget resolution, but the bottom line is, a strong economy is the only way in a pay-as-you-go system, a growing, strong, healthy economy is the only way for you to be able to have enough revenues coming into the Federal Government to be able to pay Social Security retirees. If we want to change the system, and I believe in changing the system, keep it the way we have now, but for the future having similar private accounts, whether it is like we have a Nevada PERS or whatever it is, to where you have real assets that are returning a better rate of return that many other countries in the world are changing their Social Security systems into, if we have that, that is a better way for the long-term solvency for Social Security, in this Senator's opinion. But the current system would be threatened by the amendment of the Senator from New Jersey because we are in the situation of a fragile economy, and tax increases could send us into a double-dip recession.

Mr. ENSIGN. Let me make a few points, and then I will be happy to yield. There is no cash. There are Treasury bills, basically financing debt that we have for the long term. And we get a very low rate of interest on those for the Social Security trust fund. The pension systems of companies and States have real assets in them. The State of Nevada has the Public Employees Retirement System. It is a system that a lot of States have. Most teachers, police officers, and the like are not in the Social Security system because they are in a pension system. The easiest way to explain that is, instead of the taxpayers of today paying for the retirees of today, the retirees' money that they earned while working got put in a system that earned money, so that when they retired they started getting that money back out with interest. For retirees of today under Social Security, theirs was put in a paper account. It has earned a tiny amount of interest, but the workers of today pay in taxes for their retirement payments. That is how it works. It is a complete difference. By the way, for the State of Nevada, since we have had our PERS system--I think for 25 or 30 years, whatever it has been--the average rate of return has been 11 percent. Social Security is about 2, 3 percent, somewhere in there--1 percent. It is a lot lower, we know, than 11 percent. If Social Security would have been set up as a retirement system, as a pension system with real assets, what the Senator is trying to do-- put money into that system--may work. But it is not set up that way. It is set up as a pay-as-you-go system. All this money you give to Congress today, they will spend it. I have been around here 3 years, but it is obvious: If you give more money to this Government, it is going to spend it. It is an easy way to get reelected, just giving money to people. So while the Senator from New Jersey wants to put it in to save Social Security, it is not going to do that. As a matter of fact, it will raise the baseline which will put more liability into the future. I yield the floor.

Mr. ENSIGN

Mr. ENSIGN. Maybe 10 or 15 minutes.

Mr. ENSIGN. Mr. President, I want to make a couple of comments about the budget we have before us today. It was an interesting process, once again, in the Budget Committee last week. We had a lot of amendments that went pretty much down party lines. But one comment I will make about the Budget Committee that is maybe a little more encouraging this year is the rhetoric was not nearly as harsh. And that, in an election year, I think is something positive to take out of the whole discussion in the Budget Committee. While there were differences, I thought it was at a little higher level this year--my second year on the Budget Committee--than my first year. I thought there was a little less rancor and a little more agreeing to disagree type of attitude on the Budget Committee. There are differences between the two sides, and sometimes even within our own parties, as we look at making policy. The ranking member on the Budget Committee has made a lot of issues about deficits. I echo that. I think it is very important we get the looming deficits in the outyears under control because they are a huge threat to the long-term health of our economy. Having said that, there are reasons for deficits, and there are acceptable reasons for short periods of time to run deficits. The two biggest reasons would be being in a recession and having a war. Unfortunately for our country, those both hit at the same time. We had, obviously, the recession which started at the end of the Clinton administration and continued on into the early parts of the Bush administration. Then we had September 11 and the global war on terrorism. We had the huge costs for New York City, the huge cost to our economy 9/11 has had, as well as the cost in increased spending the global war on terrorism has had. Given all of that, it is understandable why we have a $500 billion deficit. Where I would disagree with my colleague, though, is what are we going to do with it now. How are we going to go into the future to get our hands around this deficit, to bring it down to an acceptable level? I think an acceptable level is to do what we were doing; and that is, to start paying down some of the long-term debt. With the baby boomers out there, we have to have a growing economy. We have to get some of this debt under control so we will be able to afford some of the things people want to be able to afford, as far as our Government spending is concerned. But we have to look at how do we go forward. What are our priorities? That is what the budget we have before us attempts to set. We have more money for education. We have more money for veterans benefits. We have more money for the defense of our country. We wish we did not have to be spending all this extra money on the defense of our country, but that is the primary role for the Federal Government, according to the Constitution, to defend the United States of America. This budget reflects that primary role of the Federal Government. Having said that, I want to look at how we have gotten to the present deficit so we can have a document that takes us forward. This pie chart we have shows the various reasons why we have the deficit we have today. About 40 percent of it, shown on the yellow portion of the chart, the largest chunk, is because of the poor economy. Some of that can be blamed on September 11. Some of it is because of a downturn in the business cycle, and we are coming out of it. But the fact is, that is a big part of the reason we are in this deficit. Almost 40 percent--37 percent--comes in the red area on this graph, and that is because of new spending. That is everything from the war, education programs, veterans benefits, environmental programs, roads, everything you can think of. That is new spending. That is almost 37 percent. The tax cuts have reduced revenues--out of a total of 100 percent of the reason for the deficit, it accounts for about 23 percent of the deficit. You can also make the argument, though, that the economy would be worse without the tax cuts. Therefore, the yellow-shaded portion, which is the 40 percent, would be even higher without the tax cuts. Because what the tax cuts did--and Alan Greenspan has testified to this--is they stimulated the economy so fewer people were on the unemployment rolls and more were working. That is the reason we have a lower unemployment rate today. That includes self-employed people. That is a big part of what people are doing. They are starting their own businesses. One of the big things we heard from a lot of States is their State budgets are in trouble. We saw a dramatic decline in the value of the stock market. The NASDAQ, toward the end of the Clinton administration, was tanking. Then we had September 11. All of that, with the bad economy, kind of combined and we saw huge losses in the stock market. Since the tax cuts we passed last year, we have had an increase between the New York Stock Exchange and the NASDAQ of $4.5 trillion in value. We would see an increase in tax revenues at this point except there are so many people who had losses from before when the stock market tanked that we do not have a huge amount of increased revenues. But the fact is, as the stock market continues to go up, we are now poised to start reaping the benefits in new revenues to the Federal Government from the stock markets and capital gains taxes. By the way, in the State of California, one of their biggest budget problems was the lack of capital gains taxes. The more the stock market goes up and the value of property goes up and the value of a lot of things goes up, the more State budgets are going to be helped, especially States that rely on revenue sources such as that, such as the State of California does. I wish we could get more of a handle on Federal spending. I believe it is out of control. I want to run through a few charts to show that when we were in surpluses, people got a pretty strong appetite. The ranking member on the Budget Committee talked about how we all have big appetites around here for spending. It is an easy way to get reelected, to keep giving that money out. It is hard for people to say no. When we were in those surpluses, the appetite increased. Federal spending went up fairly dramatically. You can argue for every one of these programs, it was justifiable. But we have to realize we got to this point. A couple of examples. These are simple examples. The Low Income Home Energy Assistance Program. You can see in the last several years how it had gone up. Then it went down for a few years. Now it has gone back up. For the Centers for Disease Control, there have been dramatic increases in the last several years. The increases started in about 2000, and went forward pretty rapidly. The child nutrition programs, you can see, continued, but with a fairly good uptick in the last few years. The child care funding in around 2000 had a huge jump compared to what it was during the 1990s. It was fine when the economy was producing a lot of tax revenues. This is the National Institutes of Health. Their spending, as you can see, has had a very rapid rise. There are a lot of great programs, but the fact is, we have built a lot of spending into our budget now. As Ronald Reagan said--and I am paraphrasing him--he discovered, when trying to eliminate Federal programs or Federal spending: The closest thing to eternal life in Washington, DC, is a Federal program. That was a true statement back then and remains so today. Both sides of the aisle are going to have to come together and address the problem of Federal spending. The ranking member of the Budget Committee has argued that we need to start looking on the revenue side. I have a philosophical difference of opinion because I believe increasing tax rates takes away the incentive for businesses to invest. I remember when I was in business as a small businessperson, and I maybe wanted to do an expansion on my animal hospital. As a practicing veterinarian, if the Government was taking more money, I would have less money to be able to make that decision. Maybe I couldn't add that extra employee or I couldn't do the expansion to add on to my building. The more money I had in my pocket because the Government was taking less, the more money I could pump back into the economy by doing an expansion of the building or by hiring another employee. Even if I didn't hire an internal employee, doing an expansion obviously puts other people to work. That is why there is a philosophical difference between the two sides of the aisle on taxes and tax cuts. I want to put it in the hands of investors and entrepreneurs to stimulate the economy. It can be that low-income tax cuts, child tax credits, things such as that, help the economy because then those folks go out and spend money. The bottom line is, we have to have a strong economy and have tax revenues going up. We are not going to cut spending around here--we all know that--but at least slow the rate of growth down to the point where the tax revenues start outpacing what we are doing spending-wise so that we can start taking care of these deficits and eliminate them within a few short years. I am not a person who thinks that 7, 10, 12 years out is acceptable to have deficits where they take a dip down and then they start going back up. I believe we have to take it down as we did in the 1990s, take it all the way down to where we start actually paying off some of the long-term debt so that we leave our children and grandchildren with a smaller Federal debt than we currently have. If we don't, with the retirement of the baby boomers, our children and grandchildren will have to pay higher taxes. It is important we join together across party lines and work out the differences we can, understanding there are philosophical differences. The one place we both agree is that we need to hold the line on spending. We will have different priorities of where that spending is, but we need to hold the line on Federal spending, especially over the next couple of years until the economy starts becoming robust. I yield the floor.

Mr. ENSIGN

Mr. ENSIGN. I ask to be recognized after Senator Alexander.

Mr. ENSIGN. For myself, I would only need 5 minutes. Senator Alexander?

Mr. ENSIGN. Mr. President, I understand the Senator from Tennessee is going to seek recognition. I ask unanimous consent that following the Senator from Tennessee, I be recognized to speak on the R&D amendment.

Mr. ENSIGN. I yield to Senator Alexander.

Mr. ENSIGN. I ask unanimous consent the time until 3:30 be equally divided in the usual form and that if the Bingaman amendment has not been previously disposed of, the Senate would then vote in relation to the Bingaman second-degree, to be followed immediately by a vote in relation to the Hatch first-degree, as amended if amended, provided further no additional second degrees be in order prior to the vote.

Mr. ENSIGN. Mr. President, I ask unanimous consent the order for the quorum call be rescinded.

Mr. ENSIGN. Mr. President, I want to speak on the R&D tax credit that is in this bill--the proposal to extend that tax credit which is scheduled to expire. I want to talk about some of the benefits. This is a tax credit that has been supported by both sides of the aisle and by both bodies. There are many benefits to keeping this R&D tax credit as part of our Tax Code; first of all, the industries that benefit from this tax credit. I am the chairman of the Republican High- Tech Task Force in the Senate, and I hear about this issue all the time from very important parts of our economy and how important it is to the creation of jobs. The industries that benefit from this include--it is not limited to the aerospace industry--the agriculture industry, biotechnology, chemical industry, electronic, energy, information technology, manufacturing, medical technology, pharmaceuticals, software and telecommunications, as well as others. It is not just big business that benefits from this R&D tax credit; it is also many small businesses. The companies that perform significant amounts of R&D perform that research and development in the United States. They pay very good wages to the people who do the research and development. This tax credit should be made permanent in the long run. That is my goal--to someday make this tax credit permanent. We keep extending it. I think it has been extended 10 different times over the years. It was allowed to actually lapse once, but it has never been made permanent. I believe it should be made permanent. Unfortunately, we can't do that in the context of what we are doing today. But we should at least make sure that R&D tax credit is extended for the 18 months the bill calls for. Why is it important? New vaccines, faster Internet, and other communications capabilities, safer transportation, enhanced energy- efficient appliances, higher quality entertainment, better homes, improved national security. The list of societal benefits as a result of R&D is endless. R&D is the lifeblood of the U.S. economy. We really should encourage not only adoption of the extension but also eventually making permanent this tax credit. The revenue analysis, according to the economic benefit of the R&D tax credit prepared by Coopers & Lybrand in 1998 says: In the long run, $1.75 of additional tax revenue would be generated for each dollar the Federal Government spends on the credit, creating a win-win situation for both the taxpayers and the government. I will conclude with this: We should do the right thing for the economy and allow companies some level of predictability. We keep telling them we are going to extend it, we are going to extend it. But, frankly, it is hard when research and development is usually planned long term. It is hard to do that when we keep coming up to the deadline and then finally extending the tax credit. I encourage us to do what we are doing today--extending it for 18 months but also be looking for ways to make this R&D tax credit permanent. I yield the floor.

Mr. ENSIGN

Mr. ENSIGN. I would like to ask the Senator from Washington a question. I mentioned before that we gave the States about $8 billion a couple of years ago and that there is still over half of that money unexpended. I wanted to know if the Senator from Washington was aware that her State was given about $167 million and so far the unexpended available balance to the State of Washington is about $165 million out of $167 million that was given to your state. I realize you have a higher unemployment rate than the rest of the country. I am kind of curious why your State has not spent the money we gave from the Federal Government?

Mr. ENSIGN. Mr. President, I will take a minute while the Senator from Oklahoma is getting ready to make a couple of other points. At some point we have to have some fiscal discipline around the Senate. There are good arguments to make in support of extending unemployment benefits. There is always anecdotal evidence, stories of hardship cases. You can always find those. If we had a 1-percent unemployment rate, you could find people out there who were unemployed, and unemployed for a long period of time, no matter how low the unemployment rate. The question is, by extending these benefits, do you create more of a problem than you are solving? In other words, we know that about 50 percent of the people who are on unemployment will get a job in the last 2 weeks before their benefits run out. We have to have some discipline around here, put our fiscal house in order so that in the future we don't harm the economy, so that those jobs will be there for those people who want employment. For every person who wants to get a job and is willing to work, we need to have a job available. I suggest the absence of a quorum.

Mr. ENSIGN. Mr. President, how much time does the Senator from Oklahoma wish? I yield to the Senator 10 minutes.

Mr. ENSIGN. How much time do I have remaining?

Mr. ENSIGN. The Senator from Oklahoma is correct, it is a rarely used tactic from the past that has been used increasingly more. It is obstructing the work of the Senate. I reserve the remainder of my time.

Mr. ENSIGN. They are filibustering the appointment of conferees. For those people who do not know what that is, we have to appoint people to be able to work out the differences between the House and the Senate so we can bring the final bills back to both before we take it to the White House. They are filibustering a bill that was passed unanimously.

Mr. ENSIGN. I will take a couple of minutes. I asked the Senator from Washington a question a little while ago. Of the $8 billion we gave to the States, each of the States was allocated a certain amount of money and the State of Washington was allocated around $167 million. Up to this point, the State of Washington--this is money on which the legislature in the State of Washington has to act; they take that money and spend it on unemployment benefits--so far has only used about $3.5 million of the $167 million. Earlier, the Senator from Massachusetts was in the Senate discussing with the Senator from Washington, saying it is difficult to access. Massachusetts has used every dollar they were given at that time--every dollar. So the Senator from Washington, the sponsor of this amendment, her own State has not used the money the Federal Government made accessible to them. It seems to me they ought to at least use that money to help the people in their own State. Also, we had the Workforce Reinvestment Act that passed unanimously in the Senate. This act would help about 900,000 people in the United States to be retrained for new jobs. The other side is filibustering the appointment of conferees. We need to complete that bill if we want to help those people out of work get retrained so we can get them into other jobs.

Mr. ENSIGN. Yes.

Mr. ENSIGN. There is $4.3 billion that has not been used that we gave the States.

Mr. ENSIGN. I yield.

Mr. ENSIGN. Mr. President, I will wrap up my remarks. I have a couple comments. First of all, the economy is improving now, it is not just going to improve in the future. We are in the middle of a recovery. We just had the strongest quarter of GDP growth in 20 years. Jobs are being produced. Payroll versus household--I do not know how many times we have to say it, but self-employed people count. They count in the household survey. Over 2 million jobs have been produced within the last year. When you count the households and all those self-employed people, those jobs should count in what we are talking about here. If somebody lost their job and then started their own company, that should count as a job. And that is what a lot of people have done. We know incredible success stories of when people have lost their jobs and then started their own companies. Mr. President, it is time to end this continued unemployment benefit extension, this billion-dollar-a-month program and encourage people to go to work.

Mr. ENSIGN. Mr. President, I rise in opposition to the Cantwell amendment, and want to put this in a little perspective. We have an unemployment benefit insurance program and then we have the temporary extension of the benefit program which we have been doing for some time now. In fact, I think the temporary extension has been done two different times. I also want to clear up some of the confusion because there is a payroll survey which measures the amount of jobs created, and there is a household survey. We know what statistics can do depending in whose hands they are, but let us at least know what the facts are. Payroll survey measures--if someone goes to work for somebody, they get a job and go on their payroll, that is the payroll survey. So if a person is employed by somebody, it is counted in the payroll survey. When I was practicing as a veterinarian, I opened my own practice. I was self-employed. That does not go on the payroll survey, but it does go on the household survey. Right now, on eBay--we have all heard of eBay--there is a fairly solid estimate that there are now over 200,000 people with full-time businesses operating on eBay. These are full-time jobs and the individuals are doing very well operating on eBay. They are buying and selling things on eBay. However, those 200,000 jobs are not counted in the payroll survey. That is the survey the Democrats are commonly referring to all the time when they are saying there are job losses. To show the difference between the payroll survey and the household survey with statistics, in January the payroll survey said we had created about 100,000 jobs. The household survey showed the creation of almost half a million jobs. Now if one believes the other side, they are saying to somebody who is self-employed that they do not have a job. Well, I am sorry, but when I was a self-employed veterinarian working 100 hours a week, I thought that was work. I thought that was a job. Listening to the other side, they are saying it is not a job. Having said that, let's look at unemployment rates, which is a measure of the payroll survey. When the Democrats were in charge of the House, the Senate, and the White House, all three bodies, they had the ability to extend this program on their own because they had the votes to do that. Let's look at the historical unemployment rates versus today's unemployment rates to see whether they extended the program; in other words, to see when they had the ability to act whether they matched it against what they are saying today. In the early 1990s when the Democrats were in control of the Senate, the House, and the White House, the unemployment rate at the start of the program was 7.0 percent. When we started the program this time, the unemployment rate was at 5.7 percent. At the peak of the program in the 90s, the highest unemployment rate under the Democrats went up to 7.8 percent. The peak unemployment rate this time went to 6.3 percent. When the Democrats voted to end the program, to terminate the extension of unemployment benefits, the unemployment rate was at 6.4 percent. What is that unemployment rate today? It is at 5.6 percent, almost a full percentage point less than when the Democrats controlled the Senate, the House, and the White House, and they voted to terminate the program. Why did they vote to terminate it? Because the extension of unemployment benefits is put in during times of high unemployment rates. Well, they are saying times have changed. Statistics back then do not compare with statistics now. I do not know why, but that is what they are saying. Let's point out what this Senate and the House did last year. We gave the States $8 billion to help fund their own unemployment programs-- especially those States that have high unemployment like Oregon. The Senator from Oregon was just on the floor speaking. We gave that money to the States to handle serious problems with individuals facing long- term unemployment. What have the States done with that money? We gave them that money 2 years ago. In March 2002, we gave $8 million to the States. What have they done with it? Well, there is $4.3 billion the States have not used. Are our States not compassionate? Do they not care about people, as the other side would have us believe? They have not spent over half of the money we gave from the Federal Government to the States. So I think we have to look at what is going on today with this amendment. I believe this is very well intentioned by the other side, but what has happened is our mindset has changed. What used to be considered full employment is now considered high unemployment. All of us back in the early 1990s thought a 5.5 percent unemployment rate would be considered full employment in this economy, because there are always people who are changing jobs so they are temporarily unemployed. There are always people who have difficulty because of training, they are getting some new training so it takes them longer to find a job. Then sometimes, frankly, in a changing economy, people do have to move to find a job. Sometimes it takes a long period of unemployment for people to make that decision. It is a very difficult decision to make. I think we need to be sensitive to people, but we also have to look at the reality we are facing. We are facing huge budget deficits today. How many of the people running for President have been talking about the budget problem? On the other side of the aisle, I have heard it talked about time and time again. Well, the extension of the unemployment benefits costs almost $1 billion dollars a month. So if we extend it out to the end of this year, we are going to be talking about another $10 billion, or somewhere thereabouts, added to the budget deficit. That money will be borrowed from the Social Security trust fund, because when there is deficit spending, that is where it is taken out of. We all know that. It is a paper trust fund anyway, but we all know that is where it will be taken out of. So I think it is important for us to understand, first, what got us here, what the historical implications have been as I have laid them out, and then what do we do to get out of this dilemma. What we do to get out of it is to make sure we have a strong enough economy so new jobs will be created. What are all of the economists--and I do not care which philosophy the economists subscribe to, the one thing everybody agrees with is these large budget deficits we are experiencing today and that are projected out into the future are the No. 1 single threat to our economy. So if we want to have a secure future going forward, we must watch and curtail additional Federal spending. The reason we have the deficit today, over half of it, is because of the poor economy. So when businesses and individuals are not making as much money, they do not pay as much in taxes. Over half of the budget deficit is caused by that. About another 27 or 28 percent of the budget deficit was caused by increased Federal spending. And about 20 percent of it were the last two tax cuts that were enacted. But without those tax cuts--it is widely accepted now those tax cuts have helped the economy--we would be in even worse shape. The number one thing we can do for the economy, as a Federal Government is to create the atmosphere where those jobs are created. So the number one thing we can do is make sure we keep our fiscal house in order by restraining Federal spending. Looking back at the payroll survey, eight months prior to the tax cuts we lost 386,000 jobs. Eight months after the tax cuts we produced 300,000 jobs. That is just the payroll survey statistics. That does not count the household survey, or all of those self-employed people I was talking about earlier. There are literally a couple of million jobs that have been produced since the tax cut, when you count self-employed people. The other side says that doesn't count. Just ask somebody who is self-employed whether they think their job counts and should count in the national statistics. I think everybody who is self-employed out there, if you have a mom-and-pop business, if you are a doctor who used to work for a hospital and have your own practice, or you are a nurse- midwife and you decided to take the risk and go out on your own, does your job count? A nurse practitioner or a physical therapist, whatever the job is, should that job count? I believe it should. I believe that is why there are two different surveys, the household survey and a payroll survey. It is important that we have both of them so we can look at the big picture. The economy is changing. We have to have policies that reflect those changes. I yield the floor at this time so we can go back and forth and continue the debate. I see my friend from Oklahoma. Next time I get recognized, I will yield some time to him.

Mr. ENSIGN. I will yield you 1 minute.

Mr. ENSIGN

Mr. ENSIGN. Mr. President, I wish to make a few opening comments on the medical liability bill. Last year we had a debate in the Senate on proceeding--not voting on but proceeding--to an overall medical liability reform bill. That vote was 49 to 48 in favor of going to the bill. Unfortunately, the rules of the Senate provide that one needs 60 votes. Otherwise, a filibuster, as it is commonly referred to, is continued. You cannot proceed to debating the legislation or to votes or amendments. There are currently 19 States, according to the American Medical Association, that are in crisis. Nineteen States are experiencing some kind of crisis with their medical system because of problems with medical liability insurance. All but 5 States of the remaining are showing some problems, the type of problems that have led to those 19 States being in crisis. We had the vote last year and couldn't get it done. Senator Gregg and I have introduced the bill before us today, the Healthy Mothers and Healthy Babies Access to Medical Care Act. This bill limits the scope of reform of the medical liability system to the practice of obstetrics and gynecology and the doctors involved in those practices. Using my own State as an example, at the University of Nevada School of Medicine there has been a dramatic decrease in the number of medical students deciding to go into obstetrics. This is happening at a time when Nevada is the fastest growing State in the country. Southern Nevada--Las Vegas, in particular--is by far the fastest growing metropolitan area in the Nation. Not only are we not adding the OB/GYNs we need, we are actually losing them. The other side will argue that the General Accounting Office did a study and determined that doctors are not giving up their licenses. They said that doctors are not leaving their States. The problem with what the General Accounting Office did is, they went to the State boards and only did a survey of licenses. I was a practicing veterinarian and still have a license in veterinary medicine. Once you have a license, you never give it up because you never want to take the exam again. So when the General Accounting Office asked the State board of medical examiners how many doctors have given up their licenses, and they found out nobody had given up their licenses, that should not surprise anybody because they are not going to give them up. That does not mean these doctors are not quitting practice in Nevada and other States--Pennsylvania, West Virginia, Washington State, Mississippi, and many others around the country. It means they haven't given up their licenses because they don't want to take the exam again. But they are limiting their practices. And many of them are leaving those States that are affected. Several years ago, California gave us a good model. California is right next to my State of Nevada. California passed what is known as MICRA. It is a medical liability reform bill. Luckily, they passed it back then because the trial lawyers have become so powerful across the United States that you could never get the same piece of legislation passed in California. That would be a shame because it has worked so well. It is the model around which we built the legislation on the Senate floor today. In California--Los Angeles, for example--OB/GYN medical liability insurance is somewhere a little over $50,000 a year. In Las Vegas, where we don't have and haven't had this wonderful MICRA law on the books, premiums can run anywhere from $110,000 up to $200,000 a year. Not only that, they are telling the doctors in Las Vegas, you have to limit the number of deliveries you do, especially if you are practicing on high-risk deliveries. If you are a woman who has a high-risk pregnancy, you want the best possible doctor you can get. Unfortunately, those doctors are having to limit their practice or retire or leave the State because they cannot afford medical liability coverage any longer. This is a crisis--a crisis of access to health care for women who need the health care, women who are in search of gynecological services or women who are about to deliver babies. The stories--there are many of them--are tragic in many circumstances. This is, by the way, only one area of our health care system that is in crisis. Trauma is another place, and we are going to address that later this year--emergency rooms. As a matter of fact, the level I trauma center in Las Vegas closed a couple of years ago because the doctors could not afford to practice there because of the liability. There were so many lawsuits--not lawsuits that actually had merit to them; some of them did but most of them did not. Because of the potential liability, the doctors said we cannot afford to work here. So the level I trauma center that serves a four-State region had to close. That is the same level I trauma center, for those who followed the national news this last year, where Roy Horn of Siegfried and Roy was treated after the tiger had attacked him. It is an excellent level I trauma center. It saves many lives. We had a press conference last year where a woman whose father was in Las Vegas and had an accident while the level I trauma center was closed. He had to be transferred to another hospital, and because of the delay in treating him, we could definitely argue that this man would be alive today if the trauma center had not closed. That trauma center was only closed for 1 week, and it was closed for that reason. The State of Nevada stepped up; our Governor stepped up and said we will cover that trauma center under the laws of the State of Nevada. What are the laws of the State of Nevada? It has a $50,000 cap of liability--total cap. Not $50,000 for pain and suffering but a total cap of $50,000. That is not even close to what this bill says. This bill has a $250,000 cap on noneconomic, nonmedical damages. You can still get all the economic damages you would have incurred; for instance, loss of income or other types of economic damages. You can get all of the medical coverage you would need. It is just that $250,000 cap on pain and suffering awards. Those are the awards we have seen that are getting outrageous all across America. That level I trauma center, luckily for Roy Horn, was open. Without the type of intense care you can receive in a trauma center, Roy Horn, I think it could be argued, would not be with us today. Mr. President, even though we have limited this bill to the practice of obstetrics and gynecology, we do have a much bigger problem in this country, a problem that must be addressed. We are in a political season today. We know that. It is an election year for the President, the Senate, and the House, and there is a lot of politics going on. Some people say: You guys are just doing this with OB/GYNs to make a political issue out of it. If people want to stand up and say that they don't want to fix the problem happening with access to care for women and children, then I guess that is a political issue. I think it is a legitimate political issue. People need to know where Senators stand. They need to know where our Presidential candidates stand on issues of this importance. I believe that when they find out where candidates stand, whether they are incumbents or challengers, this issue will make a difference in their vote come November. It is that important to our overall quality of life in America. I believe it is wrong that we have to have people moving, or not moving, from State to State because they cannot get access to quality care because the medical liability costs are too high--one reason versus another reason. Some States have enacted good reform. Colorado and California are the best examples. My State enacted a bill, but, unfortunately, it will take several years before we know whether that bill will withstand challenge in the courts. Also, there were two huge loopholes in that bill that the trial lawyers were able to get in that you will be able to drive a truck through. That is why many in the medical community in Nevada are trying to close those loopholes. We need enactment at the national level. Sixty percent of all medical bills are paid by the Federal Government between Medicare, Medicaid, and veterans. It is a national priority. We must get this medical liability crisis under control so that our trauma centers are not closing, so that women have access to their OBs, gynecologists, and nurse midwives, who are also covered under this bill. They sometimes get left out of the discussion, but they are a very important part of our health care delivery system in this country and delivering healthy babies.